KUALA LUMPUR, Jan. 20 (Xinhua) -- Malaysian central bank has on Wednesday maintained its overnight policy rate (OPR) at 1.75 percent.

Photo: Agencies

The central bank, Bank Negara Malaysia, said in a statement that its Monetary Policy Committee (MPC) considered the stance of monetary policy to be appropriate and accommodative.

"Given the uncertainties surrounding the pandemic, the stance of monetary policy going forward will be determined by new data and information, and their implications on the overall outlook for inflation and domestic growth," it said.

The central bank also said it remains committed to utilizing its policy levers as appropriate to create enabling conditions for a sustainable economic recovery.

Meanwhile, the central bank said the global economy continues to recover, led by improvements in manufacturing and export activity, but the recent resurgence of COVID-19 cases and the subsequent containment measures had affected economic activity in several major economies.

"The expedited roll-out of mass vaccination programs, together with ongoing policy support, are expected to lift global growth prospects going forward," it said, adding that the financial conditions also remain supportive.

However, the central bank said the overall outlook remains subject to downside risks, primarily if there is a further resurgence of COVID-19 infections and delays in mass inoculation against COVID-19.

For Malaysia, the central bank said the resurgence in COVID-19 cases and the introduction of targeted containment measures have affected the recovery momentum in the fourth quarter of 2020.

"As a result, growth for 2020 is expected to be near the lower end of the earlier forecasted range," it said.

For 2021, it said, while near-term growth will be affected by the re-introduction of stricter containment measures, the impact will be less severe than that experienced in 2020.

"The growth trajectory is projected to improve from the second quarter onwards," it said.

The central bank also noted the improvement will be driven by the recovery in global demand, the turnaround in public and private sector expenditure amid continued support from policy measures, and higher production from existing and new manufacturing and mining facilities.

The roll-out of vaccines in the coming months will also lift sentiments, it added.

However, it said the downside risks to the outlook remain, stemming mainly from ongoing uncertainties surrounding the dynamics of the pandemic and potential challenges that might affect the roll-out of vaccines both globally and domestically.